VIX options indicate that tail risk has not reversed; after confirming support at $4100 for gold, there is a high probability of sideways movement.

Hot Topics

            Watchlist
Data Center
Market Center
Capital Flow
Simulated Trading
        

        Client

Source: Huicong Finance

Analysts at Saxo Bank state: “The ongoing war in the Middle East continues to trigger widespread macroeconomic shocks in global markets, forcing investors to simultaneously reassess inflation, interest rates, economic growth, and liquidity conditions. Gold is being sold off as it is one of the few liquid assets that have risen over the past year.” Gold is under pressure from concerns that high energy prices will drive up inflation and suppress expectations for further interest rate cuts in the short term.

This view aligns closely with a recent report by Ole Hansen, the head of commodity strategy at Saxo Bank. In a client report dated March 23, he emphasized: “Gold and silver are facing significant pressure, the war in the Middle East has triggered macroeconomic shocks in global markets, and investors are forced to reprice inflation, interest rates, growth, and liquidity simultaneously.” The latest spot gold price has fallen about 17% from the peak at the onset of the conflict, but has formed strong support around $4100, consistent with the market’s assessment of tail risks rather than a trend reversal.

The current gold market is experiencing a typical “liquidity shock”: high oil prices are driving up inflation expectations, market pricing for the Federal Reserve and major central banks’ interest rate cuts has slowed or even paused, combined with a strong dollar and the unwinding of leveraged positions, leading to the sell-off of non-yielding assets like gold. Although geopolitical risks still exist, Ole Hansen points out that this round of adjustment is primarily due to “crowded long liquidations, stop-loss triggers, and institutional liquidity demand,” rather than a fundamental reversal. The latest data shows that spot gold quickly rebounded after touching the $4100 level on March 23, with the 200-day moving average and psychological support level coinciding to form effective buying interest, making the probability of maintaining a volatile range significantly higher than a one-sided downward trend in the short term.

The current performance of VIX options further confirms the characteristics of tail risk. The CBOE Volatility Index recently reported 26.15, significantly elevated from before the conflict but not yet breaking historical panic peaks, and the implied volatility curve shows a “short-term high, long-term decline” structure, indicating that market concerns are concentrated on geopolitical events in the next two weeks rather than long-term trend reversals. This options pricing logic resonates with the $4100 support for gold: investors are not massively turning bearish but are hedging tail events through VIX while simultaneously positioning defensively in gold at lower levels.

To intuitively present gold paths under different scenarios, the following table compares Saxo Bank’s core views:

Ole Hansen added in his analysis on March 22: “Once the current forced liquidation phase ends, the outlook for gold could improve rapidly.” This judgment echoes the confirmation of the $4100 support: although high energy prices suppress rate cut expectations in the short term, central bank demand for gold and its long-term safe-haven attributes remain unchanged, placing the market in a transitional phase of emotional desensitization and fundamental reassessment. Investors need to be cautious of the “secondary effects” of liquidity shocks, but multiple technical and psychological supports have already been established around $4100, making wide fluctuations a likely path.

Editor’s Summary

The latest market dynamics and VIX options pricing indicate that although the war in the Middle East has triggered short-term sell-offs in gold, the $4100 support remains effective, and tail risks have not evolved into a trend reversal. Saxo Bank’s perspective reminds investors that the macro reassessment phase will primarily involve fluctuations, requiring attention to the resonance signals between oil prices and interest rate cut expectations.

 Sina Cooperative Platform Futures Account Opening Secure, Fast, and Reliable

Massive information and precise interpretations are all available in the Sina Finance APP

Editor: Zhu Henan